Latest news with #MikeLynch
Free Malaysia Today
4 hours ago
- Business
- Free Malaysia Today
HP owed over US$940mil by Mike Lynch's estate, partner, says UK court
Mike Lynch died last year when his luxury yacht sank off Sicily. (Reuters pic) LONDON : Hewlett Packard is owed more than £700 million (US$944 million) from the estate of the late Mike Lynch and his former business partner over its acquisition of their British software firm Autonomy, a judge at London's High Court said today. HP was seeking to recoup its losses from Lynch, who died last year when his luxury yacht sank off Sicily – and Autonomy's former CFO, Sushovan Hussain. The US technology giant sued Lynch and Hussain, accusing them of masterminding an elaborate fraud to inflate the value of Autonomy, which HP bought for US$11.1 billion in 2011 before the deal spectacularly unravelled. HP wrote down Autonomy's value by US$8.8 billion within a year and brought a US$5 billion lawsuit against Lynch and Hussain in London, with a judge ruling in HP's favour in 2022. Lynch, once hailed as Britain's answer to Bill Gates, had always maintained his innocence and blamed HP for failing to integrate Autonomy into the company. He was acquitted of criminal charges over the deal in the US and had intended to appeal the High Court's 2022 ruling, a process which was on hold pending today's decision on damages. Judge Robert Hildyard ruled HP sustained losses of over £646 million (US$871.8 million) in relation to the difference between what HP paid for Autonomy and what HP would have paid 'had Autonomy's true financial position been correctly presented'. Hilyard also said HP was entitled to another £51.7 million in relation to 'personal claims for deceit and/or misrepresentation against Dr Lynch and Mr Hussain', plus another US$47.5 million in relation to losses suffered by group companies. HP said at a hearing last year that it was seeking up to US$4 billion. Hussain settled with HP earlier this year.
ABC News
15 hours ago
- Business
- ABC News
UK court rules British tech magnate Mike Lynch's estate and former Autonomy partner owe HP over $1b
The estate of late British tech tycoon Mike Lynch has been ordered to contribute to a more than $1 billion payment to US tech giant Hewlett-Packard Enterprise. Mr Lynch, 59, and his daughter Hannah,18, died when their luxury yacht, The Bayesian, sank off the coast of Sicily in August last year. London's High Court has been hearing details of a deal gone wrong between Hewlett-Packard (HP) and Lynch's Autonomy company. Here's what we know. Mike Lynch co-founded software company Autonomy in 1996. He was the firm's chief executive and was often hailed as the UK's answer to Bill Gates. Mr Lynch was on the board of the BBC and a technology adviser to former British prime minister David Cameron. He became a British success story in 2011 when he sold Autonomy to US technology giant HP, now known as Hewlett-Packard Enterprise (HPE). That deal is at the heart of the current case. HP bought Autonomy for $US11.1 billion ($16.9 billion) as part of its strategy to expand its business software products. Then-chief executive of HP, Leo Apotheker, said at the time the deal would support HP as it moved towards selling services and products to government agencies and businesses, and away from making smartphones and tablets for consumers. Mr Apotheker was fired before the deal closed. According to the agreement, Mr Lynch would continue to lead Autonomy and its 2,700 employees. However, within a year, and amid staff lay-offs at HP, Mr Lynch left the company. The deal was founded on rocky ground. Autonomy was considered to be overvalued and HP's share prices subsequently tanked. HP wrote down Autonomy's value by $US8.8 billion within a year of paying $US11.1 billion for it. In 2015, HP sought $US5 billion in damages from Mr Lynch and former Autonomy chief financial officer Sushovan Hussain in a UK court. It accused the pair of accounting improprieties and inflating the value of the company. HP alleged that the pair misrepresented Autonomy's revenue. Mr Lynch always maintained his innocence and blamed HP for failing to integrate Autonomy into the company. The UK court earlier this week ruled that HP had suffered a loss of nearly 698 million pounds ($1.4 billion) based on the difference between the price it paid and the price it would have paid had Autonomy's "true financial position been correctly presented". In addition, the court ruled that HP was entitled to another $US47.5 million ($71.9m) for losses suffered by Autonomy group companies relating to hardware sales and other transactions. Back in 2018, Mr Hussain was found guilty in the US of wire fraud and other crimes related to Autonomy's sale. He was sentenced to five years in prison. In 2022, the High Court in London found Mr Lynch and Mr Hussain liable for fraud. While it ruled in HP's favour, a judge said the company would receive "considerably less" than $US5 billion. Mr Lynch intended to appeal the High Court's 2022 ruling, a process which was on hold pending Tuesday's decision on damages. He was extradited to the US in 2023 to face criminal charges, and he was cleared of fraud charges in 2024. In 2024, Mr Lynch had prepared a statement on the 2022 ruling that said HP's claim for $5 billion was a "wild overstatement", a spokesperson for his family said. Another hearing is set down for November, when the court will determine any applications for permission to appeal. It will also consider how to divide the damages to be paid between Mr Lynch's estate and Mr Hussain, with whom HP settled earlier this year. ABC/Reuters/AP
Telegraph
a day ago
- Business
- Telegraph
How Mike Lynch shielded his family fortune from £700m fraud ruling
After winning his freedom last year, Mike Lynch was relaxed about the prospect that he might become personally penniless. The British software tycoon had faced the prospect of decades in prison before he defeated criminal fraud charges in a San Francisco trial, and described winning the case as being granted a 'second life'. The prospect of signing his wealth away to Hewlett-Packard (HP), the tech giant that was pursuing him for billions in the English courts, paled in comparison to ending his life behind bars. But Lynch was breezy about the prospect for another reason: a large portion of the Lynch family fortune was held in his wife Angela Bacares's name, shielding it from any legal repercussions. 'My wife has been very good at investing in the things that I've told her to from a point of view of technology. We've done very well,' Lynch said in an interview after he was acquitted. 'It's not a perilous situation.' Just a few weeks later, Lynch and his daughter Hannah died when the entrepreneur's superyacht, Bayesian, capsized off the coast of Sicily, a tragedy that Bacares herself survived. But the decision for Bacares to hold much of the wealth in her name now looks like a wise move. On Tuesday, a judge ruled that HP was owed almost £740m from Lynch and his business partner Sushovan Hussain over the fraudulent sale of their software giant Autonomy 14 years ago. With Mr Hussain having settled privately, Lynch's estate is on the hook for the majority of the damages. Valued by lawyers at $450m (£333m) during his US trial, the fortune in Lynch's estate would be wiped out by the judgment. An appeal by Lynch's legal team is likely. But even if the estate is bankrupted, Bacares is sitting on a fortune worth hundreds of millions owing to the way the pair divided the proceeds of Lynch's endeavours. American-born Bacares, 58, worked on Wall Street and the City of London before her and Lynch were engaged in 2001 and married the following year. She has not made any public comments since her husband's death, beyond a brief message from the Lynch family stating they are 'devastated'. But her name has featured regularly in stock market filings, company records and court documents. While Lynch made around £500m from selling Autonomy, Bacares, who was occasionally an employee at the company, sold £15.6m of shares. By the time Lynch's next venture, cybersecurity company Darktrace, made it to the public markets, Ms Bacares was the dominant shareholder. She owned 12.8pc of the company at the time of its London flotation, compared to a 4.9pc stake owned by Lynch. Bacares and Lynch had both sold the majority of their stakes by the time Darktrace was bought by private equity firm Thoma Bravo for $5.3bn last year – netting hundreds of millions of pounds. She is also one of the biggest shareholders in Luminance, a legal AI company backed by Lynch's venture capital firm, that has raised more than $115m. Company filings also show her listed as a director at Bunhill Partners, a now defunct algorithmic trading. The couple's personal assets were also held in her name, including Loudham Hall, the Suffolk estate where they lived, and Bayesian itself. The superyacht, raised only last month, was owned by Revtom Limited, of which Bacares was the only shareholder. This may now present its own legal complications. Families of those who perished on Bayesian, including cook Recaldo Thomas and Lynch's lawyer, Chris Morvillo, are seeking compensation from the insurance company that covered the vessel. Hewlett-Packard, now known as HPE, could also theoretically pursue Bacares if there is a shortfall from the fraud case, although the optics of going after his widow would be questionable. Even if Lynch's estate is wiped out, his family are likely to be well looked after.
The Hindu
a day ago
- Business
- The Hindu
UK court awards £700 million to HP in late tycoon's fraud case
A UK court Tuesday awarded £700 million ($946 million) compensation to IT firm Hewlett Packard in a fraud case involving late British tech tycoon Mike Lynch, killed last year when his superyacht sank off Sicily. A UK court ruled in 2022 in favour of the U.S. technology giant, now known as Hewlett Packard Enterprise (HPE), in a civil case linked to the sale of Lynch's company, Autonomy. Lynch, once dubbed the "British Bill Gates", founded software firm Autonomy in the 1990s. Its $11 billion sale to Hewlett Packard in 2011 also saw him face fraud charges in the United States. HP accused Autonomy of artificially inflating its revenues and growth before the sale and had demanded $5 billion in compensation. "We are pleased that this decision brings us a step closer to the resolution of this dispute," said a spokesperson for Hewlett Packard. "We look forward to the further hearing at which the final amount of HPE's damages will be determined," they added. The further hearing, dealing with matters including interest, currency conversion and whether Lynch's estate can appeal the decision, is scheduled for November. The British court had not yet awarded damages when Lynch was killed along with his 18-year-old daughter Hannah, four friends and the yacht's cook in the sinking of his British-flagged vessel Bayesian in a storm in August 2024. Lynch, 59, his family and guests were on board celebrating his acquittal in the massive U.S. fraud case. The 56-metre (185-foot) yacht was struck by a mini-tornado before dawn as it was anchored off Porticello, near Palermo. Hewlett Packard had recorded nearly $9 billion in write-downs, including more than $5 billion it claimed resulted from accounting manipulations by Autonomy's directors before the sale. But justice Robert Hildyard in the British case wrote in his ruling that "HP's claim was always substantially exaggerated". The initial compensation award had been expected in September 2024, and before his sudden death Lynch had prepared a written reaction to the judgement. The ruling "exposes HP's failure and makes clear that the immense damage to Autonomy was down to HP's own errors and actions", he wrote, adding that the company would consider appealing the decision. A spokesman told AFP any debts would have to be discharged from Lynch's estate.
Times
2 days ago
- Business
- Times
Mike Lynch's estate faces bankruptcy over £700m court order
Mike Lynch's estate looks likely to be wiped out after a High Court judge ordered it to pay more than £700 million in damages to Hewlett Packard Enterprise in one of the UK's biggest corporate fraud cases. Mr Justice Hildyard ruled in 2022 that Lynch had defrauded Hewlett Packard Enterprise (HPE) over the US tech giant's $11.7 billion (£8.7 billion) acquisition of his business software company, Autonomy, in 2011. On Tuesday morning, almost a year since the technology entrepreneur's superyacht sank off the coast of Sicily while he was celebrating his acquittal in a US criminal trial, Hildyard announced he had awarded HPE damages totalling about £730 million. The final figure could end up being substantially higher once interest is factored in after a final hearing scheduled for November. Lynch's family indicated they would consider appealing against the ruling. Hildyard concluded that had Autonomy's accounts been properly stated, HP and Autonomy would have probably struck a deal that valued each Autonomy share at £23 rather than the £25.50 that it paid. The Silicon Valley company had demanded $4 billion, far more than the $516 million that Lynch, who was 59 when he died last August, was estimated to have earned from the takeover. Hildyard said that HPE's claim 'was always substantially exaggerated'. In a statement written by Lynch before his death, the tech tycoon said the ruling confirmed that HPE's original claim was 'not just a wild overstatement . . . but it was off the mark by 80 per cent'. He added: 'Today's judgment is a view that Autonomy's actual value was not even 10 per cent below the price HP paid. This result exposes HP's failure and makes clear that the immense damage to Autonomy was down to HP's own errors and actions.' A spokesman for HPE said: 'We are pleased that this decision brings us a step closer to the resolution of this dispute. We look forward to the further hearing at which the final amount of HPE's damages will be determined.' The damages will be paid for out of Lynch's estate. In the latest Sunday Times Rich List, the Lynch family's assets were valued at £473 million. Many assets are in the name of Angela Bacares, his widow, including Loudham Hall, their Suffolk estate, and shares in the cybersecurity business Lynch backed called Darktrace, which were sold for more than $300 million last year. If HP can prove these assets were really his, they could be targeted. HPE bought Autonomy, a pioneer in 'big data' analytics founded by Lynch in 1996, in 2011. Within months of the deal's completion, HPE claimed that Lynch and his finance chief, Sushovan Hussain, had used accounting tricks to make Autonomy appear far bigger, and financially healthier, than it was. The sale sparked more than a decade of costly litigation and investigations. In 2018, Hussain was convicted of fraud in the US and sentenced to five years in prison. He was released in January 2024 and settled with HPE in this case for an undisclosed sum earlier this year. In 2021, the Financial Reporting Council, the UK's accounting watchdog, fined Deloitte £15 million for 'serious failures' over its audit of Autonomy's accounts. After a long extradition battle, Lynch was sent to the US in 2023 to face a jury in California, but he was acquitted, along with Stephen Chamberlain, Autonomy's vice-president of finance, last June, shortly before the yacht accident in August. According to an interim report from British marine investigators, at about 4am on August 19 last year while the Bayesian was anchored off the town of Porticello, the 56m (184ft) boat was violently knocked sideways by a sudden 80mph gust. Water suddenly started cascading in and Bacares was pulled out of the vessel by a crew member. Others however, including Lynch and their 18-year-old daughter, Hannah, never made it out of the boat as it sank 45m to the sea bed. The conclusion of the UK legal proceedings has been in limbo since the maritime tragedy. Although HPE wanted $4 billion, few thought it would get that much. Hildyard said in his original findings that the US company was unlikely to get the sum it was after, because HP may well have bought Autonomy, regardless of the fraud.
